IBC shareholders to receive 1.5 shares of MGI when approved.
agnum Goldcorp et al. sign definitive deal for LH
2016-03-10 12:02 ET - News Release
Also News Release (C-CBV) Cobra Venture Corp
Also News Release (C-IBC) International Bethlehem Mining Corp (2)
Mr. Douglas Mason of Magnum reports
MAGNUM GOLDCORP, COBRA VENTURE AND INTERNATIONAL BETHLEHEM ANNOUNCE SIGNING OF AN ASSET PURCHASE AGREEMENT REGARDING THE LH PROPERTY PROJECT AND ANNUAL AND SPECIAL GENERAL MEETINGS OF SHAREHOLDERS
Magnum Goldcorp Inc., Cobra Venture Corp. and International Bethlehem Mining Corp. have provided an update on the acquisition by Magnum of all of the interests of each of Cobra and IBC in the LH property. On March 1, 2016, the parties entered into a definitive asset purchase agreement with respect to the LH property transaction and have set April 11, 2016, as the closing date. The LH property is currently jointly owned by the parties, with IBC owning 49 per cent and Magnum and Cobra each owning 25.5 per cent. Upon closing of the LH property transaction, magnum will own 100 per cent of the LH property.
Terms of LH Property Transaction
Magnum will issue 17,120,000 common shares in its capital to Cobra and 32,897,255 common shares in its capital to IBC (collectively, the "Magnum Shares") at closing as consideration for their respective interests in the LH Property. The LH Property Transaction is considered to be a reviewable transaction with respect to each of Magnum and IBC for the purposes of the policies of the TSX Venture Exchange (the "Exchange"), and accordingly, is subject to approval by the shareholders of each of Magnum and IBC and approval by the Exchange.
Magnum has certain directors in common with each of IBC and Cobra, which directors are considered to be non-arm's length parties within the policies of the Exchange for the purposes of the LH Property Transaction, and accordingly, those directors have abstained from voting on board resolutions passed by the respective Parties approving the LH Property Transaction.
Return of Capital
IBC intends to distribute 17,026,427 of the Magnum Shares it receives under the terms of the LH Property Agreement to its shareholders on a pro rata basis, which will result in IBC shareholders receiving approximately 1.5 Magnum Shares for each share of IBC held. IBC intends to retain the remaining 15,870,828 Magnum Shares to assist IBC in meeting its ongoing commitments and obligations and to enable IBC to participate, as a shareholder of Magnum, in the potential future value of the LH Property project.
Cobra intends to distribute all of the 17,120,000 Magnum Shares it receives under the terms of the LH Property Agreement to its shareholders on a pro rata basis, which will result in Cobra shareholders receiving approximately 1.08 Magnum Shares for each share of Cobra held.
The return of capital of each of IBC and Cobra is subject to approval by their respective shareholders.
Annual and Special General Meetings of the Parties
Each of the Parties will be seeking shareholder approval to the LH Property Transaction and/or the return of capital, as applicable, at an annual and special meeting of its shareholders to be held April 7, 2016. A Notice of Annual General and Special Meeting and Information Circular has been sent to shareholders of record of each of the Parties, based on a record date of March 3, 2016. For further details please refer to the Notice of Annual General and Special Meeting and Information Circular of each of the Parties available on SEDAR.
The LH Property
The LH Property is a gold exploration project located south of Silverton, British Columbia, on the east side of Slocan Lake and consists of 19 contiguous crown granted claims and seven mineral claims. Magnum is the operator for exploration work on the LH Property under the terms of a joint venture arrangement amongst the Parties.
For additional information on the 2015 exploration drilling program and assay results for the LH Property project, see Magnum's, Cobra's and IBC's news releases dated August 18, 2015 and July 6 and 7, 2015, and the technical report with respect to the LH Property dated March 9, 2016 and available on Magnum's SEDAR profile.
We seek Safe Harbor.